For me, I loved this episode for a mix of reasons.
One, as mentioned before, I think Sarah and David both did an amazing acting job in this episode. They did a good way of really conveying the characters' emotions as well as fitting into new roles well (especially roles of the opposite sex, and since they actually did have James/Grace played, I think they matched them pretty well).
The theme of forgiveness was also very great throughout this episode, and I think the writers did an excellent job with it. The way they paralelled James/Grace's story to that of Buffy and Angel was great. It forced the characters to deal with what had happened (literally) and the line "To forgive is an act of compassion, Buffy. It's, it's not done because people deserve it. It's done because they need it." really is true in this world. Also, when Buffy said "I still... A part of me just doesn't understand why she would forgive him.", it showed that even though she had been through the whole experience, she hadn't forgiven herself for what had happened with Angel. Which really was her "flaw" or "weakness" of this season. It was not only that Angel had turned evil, it was that she blamed herself for it.
Also, since I found Angel's eventual "forgiveness" of Buffy in season 3 wasn't ever directly adressed (or Buffy's of Angel), this was an important episode to do (since it kind of helped us understand how Buffy and Angel reacted to each other in season 3, and how neither seemed to have a burning hate for each other.)
It also really showed huge character development for Giles, Buffy, and Angel. Giles, because of how strongly he initially believed it was Jenny; and how in the end he was forced to accept it wasn't and more/less move on (or at least deal) with the fact that Jenny was dead. It was kind of like the whole situation of him researching and trying and trying to prove it was her was a way he was dealing, and I found it astonishing how quickly he realised it wasn't her.
With Buffy, it was the whole journey of being in James' shoes, and being shown that forgiveness is a possibility. It was almost like she was living through her own life really, as if it could have been her and Angel themselves at the high school. It may not have changed her mind about her own forgiveness in the end, but it did force her to see another side to the story. She was such a huge part of the closure that Grace and James got, that she would have had a lot to think about. And despite her disbelief on their ending, it would have forced her to reconcider her own situation, even slightly. And at least partially deal with her own guilt in the process.
Angelus, as mentioned above, seemed to have to deal with his own feelings towards Buffy. It was like this cocky, cool, emotionless bravado he had in place up until this point fell the second that he realised that he'd kissed Buffy. When he returned to the mansion he seemed almost distraught by it, uncomfortable, irritable, as though just as (if not more) angry (or frightened) by the feelings the experience awoke within him than the situation itself. He seemed to be almost possessed with the notion to get rid of any trace of "love", and was itching to go out for a bruital kill to do it. There was also only one episode between this point and when he decided to suck the whole entire world into hell, it seems too coincidental to me to NOT concider that this experience could have had something to do with that.
And of course, there were bangel smootchies, always a good thing 😉
I also really liked the story of James/Grace, and how it was written (with James immediatly being drawn to Buffy, and how he kept everyone who wasn't Buffy or Angel far away).
Anyway, that's my take on it at least. In my opinion, it was a beautiful and extremely well done episode.
